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November 21, 2006

Senior Survey Says...

Social Security and pensions primary retirement income

They have certainly read enough about the increasing needs for proper retirement plans and personal retirement savings accounts, but according to a recent survey conducted by MFS Investment Management, affluent retirees rely most on pensions and Social Security to pay their retirement expenses.

Only one out of five retirees says income derived from the sale of a primary residence helps pay retirement bills. Nine out of 10 retirees rely on Social Security to cover expenses, while seven out of ten cite a pension plan and one-third report a 401(k), and fewer than one in five retirees work part-time to meet costs in retirement, the survey said.

Although the vast majority of retirees acknowledged that private savings (73%) or IRAs (68%) are sources of their income, six out of 10 said they were concerned that their retirement savings would not keep up with inflation. The rising cost of healthcare was cited as a big concern, as was the future of taxation.

The MFS study surveyed 222 affluent retirees between the ages of 55 and 75.